Shared ownership mortgage help please

Natztastic2

Hello,
After some seeds of wisdom if possible please.

We have been paying off our debts and saving for our first home. In the time we have applied for the shared ownership scheme through the government and have been accepted. We were told when we had enquired before to save 5% as a deposit.

We now have the 5% deposit, but is it possible at this moment in time to get a shared ownership mortgage with a 5% deposit? I'm worried due to post covid times that the banks will not lend to those with small deposits. Do you have to apply for a special shared ownership mortgage or is it just a normal mortgage product for a lower overall amount?

If they decide they want 10/15% would I better off waiting, saving more money and then buying a dill property with the help to buy equity loan? This way I would have 5% but the government contribution would class as another 20% deposit so I would only need a mortgage for 75%?

Thanks in advance,
Natalie

House price £245k
40% share = 96k
Deposit available 5k plus money set aside for solicitors fees, reservation fees etc.

MovingForwards

(removed as incorrect)

Have you got a broker as you don't want to be trying to do this on your own, you need to have someone managing your expectations.

[Deleted User]

Plenty 5% shared ownership deals still around.  Even a 0% deposit shared ownership as well!
It's the 1 bit of the market that was fairly well supported but its mainly been supported by smaller lenders you won't have heard of. 

It needs to be a specialised shared ownership mortgage so seek out a broker and check they can access the smaller regional building societies you will need for this 

MovingForwards

Never thought the deposit would be 5% or 0%, surprised more people don't go for S/O for that alone.

Speak with friends and family who have recently purchased a S/O property to see who they used. If no one has recently purchased then you may want a chat with 
@haras_n0sirrah who is the resident S/O broker, you can approach her, she cannot approach you.

haras_n0sirrah

Absolutely no issues with 5% shared ownership mortgages. I have currently got about 20 clients going through at 95% shared ownership. 
They are special shares ownership products though and not something you will find walking up and down the high street.
Rate wise you are looking around 3.2% but for 95% it isnt too bad really.
Happy to help if needed

Natztastic2

MovingForwards said:

(removed as incorrect)

Have you got a broker as you don't want to be trying to do this on your own, you need to have someone managing your expectations.

Thanks for the reply.

No a broker is our step, but I didn't want to waste anyones time or be laughed out of the bank so to speak

Natztastic2

Deleted_User said:

Plenty 5% shared ownership deals still around.  Even a 0% deposit shared ownership as well!
It's the 1 bit of the market that was fairly well supported but its mainly been supported by smaller lenders you won't have heard of. 

It needs to be a specialised shared ownership mortgage so seek out a broker and check they can access the smaller regional building societies you will need for this 

This is great news, thank you! I really thought it wouldn't be possible at the moment. Thank you so much for the advice, I will contact a broker.

Natztastic2

haras_n0sirrah said:

Absolutely no issues with 5% shared ownership mortgages. I have currently got about 20 clients going through at 95% shared ownership. 
They are special shares ownership products though and not something you will find walking up and down the high street.
Rate wise you are looking around 3.2% but for 95% it isnt too bad really.
Happy to help if needed

Thanks so much for this, it is great news as I thought it was going to be a flat out no! I have emailed you (prior to this message) to ask a few questions and then I'd really like to get the ball rolling.

Thanks so much for your help

Rebecca5833

Hi Natalie, me and my partner are doing shared ownership to, we reserved our home over 2 months ago and have really struggled to get a mortgage as im on furlough, we have managed to get somewhere with a lender who accepts furlough, i know of 3 lenders who are accepting 5% deposit as we are doing 5%. I know nationwide are doing 15% deposit as we was originally going with them. its been a nightmare but finally got there!

becky

izoomzoom

Good luck with your SO purchase.
We're just final staircasing our SO house. (Make sure you can purchase to 100%).
I found the interest rates and options were a little restricted in the first purchase, but now we are on 100% I think we had the whole market available to us. Brokers used in both cases.